Telecommunications Reform and Effects of Competition on Availability, Quality and Cost of Services in Nigeria

Abstract

The inefficiency and ineffectiveness that characterized the Nigerian telecommunications sector under the Nigerian Telecommunications Ltd (NITEL) monopoly, among other factors, informed the government reform policy in the sector. The reform, which opened up the market to local and foreign private operators, injected competition into the telecom market. The study, using trend analysis, examined the effects of the competition on availability, quality and cost of telecommunications services in Nigeria in 10 years of the reform (2001- 2010). The study found that: teledensity increased from 0.45 to 58.52 implying a high telephone penetration; there was an increase in range of services but the quality of which desired much improvement; while cost of telephone connection fell by as much as 99%, tariffs only fell by 24%. The study concluded that more regulatory measures and provision of certain network infrastructure by the Nigerian Communications Commission (NCC) are needed to eliminate perceived dominance, enhance competition, improve service quality and as well bring down tariffs.

Key words: Telecommunications, Reform, Competition, Monopoly, Policy